Daniel Agostinelli on Accent Group’s strong year
Accent Group last week reported a record set of FY19 results. The footwear firm, which owns the Platypus, HypeDC and The Athlete’s Foot retail chains and distributes brands such as Skechers, Vans and Dr. Martens, posted a 22.5 per cent year-on-year increase in EBITDA to $108.9 million on sales of $772.5 million for the year ended June 30, 2019.
Across brands, online sales nearly doubled and now account for around 15 per cent of total sales, while the retailer’s strategic shift away from discounting continued to improve gross margin. And the current year is already shaping up to be a strong follow-up to FY19.
The retailer launched a new kids’ shoe concept, The Trybe, in July, and plans to open several more stores over the coming months. Last week, it announced another new business, Pivot, aimed at value-conscious shoppers.
We caught up with Accent Group CEO Daniel Agostinelli post-results to discuss all this and more. Here are six key things he mentioned.
“What is most impressive for me and what I’m mostly pleased about is that our distributed brands all performed above expectations,” Agostinelli told Inside Retail.
Accent Group’s distributed brands include: Skechers, Merrell, CAT, Vans, Dr. Martens, Saucony, Timberland, Sperry Top-Sider, Palladium and Stance.
“The product pipeline has been fantastic from all of these brands, and what we’re hearing from them is that the forward pipeline is just as good, so we’ll have a free kick moving forward.”
“The Platypus banner continues to see us open in places we didn’t expect to open. We’ve opened in some country areas, including Albury, Victoria, and Elizabeth, South Australia. They were not on our radar, but our customers are voting with their wallets. They like what we’re doing.”
“The other chain we’re looking to launch next year is Pivot. This business will be servicing the value-conscious branded consumer,” Agostinelli said.
“It’s all branded product in the $90-100 market. It looks and smells like the high-end stuff. It’s for the average consumer out in the suburbs who may not want to spend $200, but wants branded product.”
“The product we’re thinking of for this chain will not be available under any of our current banners. Every brand [we stock] has what they call their value segment. We don’t feel it’s being serviced in a major way at the moment. We see opportunity there.”
“We invested fairly heavily two to three years ago in our digital hub. That runs all our digital sales. This year we had 93 per cent growth [online], and that’s compounding on the year prior. And it will continue to grow as the customer shifts towards buying more online,” he said.
“We definitely still feel that you need stores. We are about to launch same-day delivery across all our banners, and next-day delivery after hours. If a customer buys something online tonight, they may not want it to arrive next-day while they’re at work. They may want it to arrive after hours.
“At the same time, we’re launching Saturday deliveries. This is quite innovative in the footwear space. It’s not easy to execute, but we have some great courier partners. It’s just extending on our absolute obsession with customer experience. That is a major word that is thrown around at Accent Group. We’ll do whatever it takes.”
US-China trade war
“We’ve asked this question of some of our third-party brands, and it has not been a topic that they’re really certain on at this stage about what may or may not happen,” Agostinelli said.
“We actually see it as a potential opportunity. As prices go up in the US, it may make our pricing look better. But there’s not a definite answer [about the impact of the trade war] at this moment.”
“It’s high on our agenda. Thankfully brands like Veja and Dr. Martens have come out with vegan products,” he said.
“We’re looking at any area we feel that would allow us to move into a sustainable space…what will our carry bags look like in the future? Vegan products have been a major hit with our customers.”
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